The Difference Between Home Mortgage Pre-Qualification and Pre-Approval

A Fort Myers mortgage broker who is now working in my office emailed this to all of the agents today and  I thought it was great information. I have seen people in all price ranges speak to an ambitious mortgage broker who tells them they can get a loan and then they come  to me, pre-qual letter in hand,  wanting to go home shopping. Then they find out the pre-qual letter the broker wrote is meaningless because it is by no means an approval for a loan or acceptable to a seller as proof of real estate financing.

I made the mistake in the past once,  which I remember all too well, of taking the word of a very legitimate banker who wrote a glowing pre-qual letter for the owner of an enormous company and I wrote a $600k + home contract for that buyer based on the pre-qualification. The offer was accepted because of my strong reputation, not the letter. Then in the approval process for the loan there arose a mountain of tax and corporate legal issues that would have made it difficult for this guy to buy a Toyota. Needless to say, that  will never happen to me again, but I am still approached by buyers with pre-qual letters only. Here is a good explanation of the difference.

Pre-qualification is the first step in obtaining mortgage financing. A potential borrower answers a  few questions to provide the loan consultant with a quick snapshot of the borrower’s income, existing debt, accumulated savings and whether or not there is a co-borrower. Signature(s) allow the loan consultant to run a credit report and begin to determine what loans are good candidates for this particular client. However, there are literally thousands of loan programs available. It is important for the loan professional to know the long-term financial objectives of the prospective homeowner.

Pre-approval is a written documentation that proves the borrower has the full support of a lender. It means the form 1003 Uniform Residential Loan Application has been completed and reviewed by an underwriter. Based on the borrower’s income, debt ratio, and savings, the underwriter will provide a dollar amount this borrower is eligible for. Now the borrower has the convenience of shopping for a home in the price range agreed upon by the lender.Pre-approval allows potential homeowners to shop as cash buyers, and that means negotiating power. Sellers will take an offer from a pre-approved shopper much more seriously and may even accept a lower bid because they know the financing is in place and the deal is secure.

I am more than happy to put you in contact with several Cape Coral and Fort Myers Mortgage lenders if you do not have your own, but when we shop for properties you will need a pre-approval if you are financing the transaction. You need that prior to making an offer on a property. Preparation is the key to a successful transaction and I am here to assist you anytime. For additional information on a Fort Myers mortgage please go to www.FloridaLuxuryBroker.com.

Online Real Estate Information

Real estate transactions are a part of life where  I don’t think too much information is ever really a bad thing, except when the information ends up being completely wrong.  Customers contact me completely confused due  to all of the online real estate information, good and bad,  they receive from websites.  Frankly, even I do not understand why a property can show as active when it really has a contract accepted on it.  Web sites have become polluted with bad information.  Yes, I know the reasons about why some distressed properties need to stay active so they can try to receive more than one contract, or if they need to advertise for backup contracts. If you see a property offered on my site as active and the true status is contingent, meaning it has a contract or it is even sold, I have no way of knowing that either until  I do the direct research work. Yes, that is a problem, but it is not within my ability to fix as the online real estate database information is only as good as the outside agents who enter it. It is important that a  person takes the time to contact me to ask questions and discuss their real estate goals since the website searches are really just for the general research of online real estate.

Years ago when the internet real estate research was new, companies could only show the properties online that they offered for sale with signed listing agreements from their clients. You could go from site to site of each good company and see the properties, just like the real estate sections of local newspaper used to be.  That has completely changed.  The majority of online real estate searches now offer all properties available from centralized database systems. This abundance of property information is made available for purchase by any agents regardless of qualifications and to anyone who is willing to pay for it, including companies who sell your personal information.  When you contact me on a property you found on my site it is not always my  personal clients home that I  have under a listing contract, but as a  broker, I  am very well trained to provide real services to property buyers and sellers who want to make an educated real estate transaction.  I think one of the greatest internet disservices has been the ability of practically anyone to display real estate listing information.  I am certainly in favor of maximum exposure for sellers and the federal government involvement in the matter has ensured that those online freedoms are legally upheld.  What has harmed the quality of service in the industry is the online real estate business model that involves websites showing property information, collecting the personal information of potential home buyers or sellers and then selling that person information to any agents and who knows who else. Sometimes it is claimed that they have screened the agents in the area you are interested in and will send you to the most qualified person. Those online companies actually have no interest in your quality of service or well-being at all. The truth is you will just be sold to the agent who needs to buy your information, no matter who they may be.  It is usually called a referral, but a  real referral is when legitimate,  licensed agents call me because they have personal clients in their  location who need my professional real estate service here in my location.  We make referral arrangements in writing between offices and their clients are now my clients who get my full attention, service, and duties. You can go to www.FloridaLuxuryBroker.com for more information.

The fact is we are usually pretty smart as consumers. We are sometimes misled because we want to trust others, particularly in what should be regarded as a serious matter like real estate transactions. We look for the best value and efficiency for our money and the internet can often provide that. In a business as complex as real estate there are some corners that just can’t be cut such as the direct contact and interviewing of a good professional agent, regardless of how many pictures, prices and information some website developer creates online. Simply put, research heavily online real estate if you need to, but when it is time to do business you need to contact me and let me do my job. There is always going to be too much bad information on the internet, but it is a simple matter to have me sort out your online real estate search and help you achieve your Florida home buying or selling your goals.

My review of the book “Activate Your Passion – Create Your Career” written by Madison Hildebrand

Like many real estate agents, the Bravo channels “Million Dollar Listing” show with Madison Hildebrand caught my eye while I was surfing the channels and I had to watch. I am not  a TV person. I do not mind knowing nothing about TV shows. I just don’t sit around long enough to watch any entire show. I am almost proud to say I have never seen an entire episode of American Idol; it makes me unique.  If it were not for my DVR I would never be able to  watch a complete program.  From a real estate agents perspective, the “Million Dollar Listing” show  is  very entertaining. The interaction and differences of the three personalities  are easy to relate to in our business and  the show just cracks me up constantly. Few of us ever get to see the luxury homes of the Los Angeles area and I  have considered that many of their clients are the type of people that buy properties and investments anywhere, especially in Southwest Florida  where I work.  The show  is actually useful market information  for me.  Not knowing anything  about how these reality type shows are put together, I first assumed the three characters on the show were  actors playing the roles of agents. Hollywood is right there after all. When I noticed the three guys were actually engaging in some serious and highly professional  real estate business practices I had to consider if they were being  heavily coached or maybe they were actual agents. I Googled the names and the first  I found was Madison Hildebrand who is a real  agent at Caldwell Banker in Malibu. I heard in an episode he had a book and I saw it for sale on his site. I was still skeptical of the whole idea of the  celebrity Realtor.  My wife and I  stood right next to Sylvester Stallone on the sidewalk  at South Beach in Miami once as he was waiting for his car to get brought around. I know he is a  real person because I saw him in the flesh, but I also know he is not actually Rambo or Rocky. Both characters who I enjoyed immensely. Out of curiosity and an appreciation  of the personality I see portrayed on TV, I purchased  Madison’s book. I fully expected to receive a Bravo channel promotional pack or something of the sort, but that is not what this book or what Madison Hildebrand is about at all.

I was amazed and inspired by this  relevant,  empowering  and concise book. Plus, it often had me smiling and laughing as I read which  kept it genuinely entertaining. I own stacks of books on professional sales, corporate training manuals,  motivation, even the how to  books. As a professional in  marketing and sales it  has always been important to me to stay well informed.  I have a  couple books on the shelf half finished because they just bored me too much.  They really do just  sound alike sometimes.  I received Madison’s book in the mail and  had the time right then  to open it up  and begin reading. The next thing I knew I had read the entire book. It is not a very long book which is perfect for  busy people and it was just enjoyable to read. I felt like I was reading a long letter from a friend giving me some great advice. Some of the topics covered  include goal setting, effective business  planning,  tips on making good choices personally and in your career and sound business building practices. He also makes  outstanding points on ethics, professional presentation, and  for anyone starting a new  position working with the public. To me, what makes this book different than the stack of books  on the shelf is that it is written in a way that is not preaching or from an  overly egocentric point of view.  Madison Hildebrand writes a cleaver and engaging narrative  from a real world perspective and without even realizing it, you receive the fundamentals for a great career. What I appreciate most  from the book personally  is how it reminded me about the importance of attitude and passion not only  in my professional life, but in all important endeavors. I am 43 years old, I own companies and manage people and  sometimes  see myself  too deep in  the business end of it all.  This week after I read this book by Madison Hildebrand I  re-evaluated  how I  was interacting with my clients, especially some of my past clients and  I was able to identify and open  several outstanding new  business opportunities.  If you have been around a while, this book will remind you why you got in business and how to stay on top, if you are new it will show you a clear path to success. The book has a focus on the real estate industry, but is relevant to  most any career path especially any entrepreneur. I am hardly a professional book reviewer or critic, but I enjoyed this book and got something important out of it. I recommend this book and hope you enjoy it as much as I did.

You can buy the book on Amazon at the link below:

http://www.amazon.com/Activate-YOUR-Passion-Create-Career/dp/1419697676/ref=sr_1_1?ie=UTF8&s=books&qid=1261178726&sr=1-1

CDPE Designation and Florida Real Estate Foreclosure

Now that I have completed the CDPE “Certified Distressed Property Expert” designation  I have a much better grasp of the enormous problem of the foreclosure property market.  I have found from several sources that here about  80% of short sale contracts written do not close. Considering the time and effort that goes into making a proper offer on a property, that seems to be a colossal waste of time for everyone. There are some factors influencing these numbers including: listing agents who have only a  general idea of what the bank is looking for when presenting a sellers “contract package” causing weeks of waiting while the bank representative moves on to the properly presented contracts, multiple contracts being accepted by a seller on a single property, new scams featuring option flippers  and get rich quick schemes  that  work the  temporarily grey areas of bank fraud and the  overwhelming scope of the problem. I am all for investors buying and selling properties and investing and flipping has never been a bad thing for me personally. Especially when it improves a home and community.  There are many legitimate investors working with full disclosure and proper licenses. A predator or con artist will feed off desperation and try to convince you to purchase ridiculous e-books and CD’s  or pay hundreds of dollars for a seminar to learn about their system/scam or even worse when you can’t even make your house payment. A legitimate investor could be a great resource  depending on your circumstances, but scammers create greater losses in a short sale for everyone involved (except for themselves of course) and they expose short sale home sellers to a potentially greater default judgment and higher promissory notes.  I don’t want to think of what the lenders may do legally as they absorb inflated short sale losses and address the option flipper “or whatever the scammer calls it”  problem. Some banks  restrict the  resale of short sale properties for a time period after the short sale closing and I know  the wording  in a sales contract or letter is probably not sufficient to keep a lenders legal and loss departments  from pursuing a judgement against the  seller during the five years they have in Florida to come after them,  particularly if they believe fraud may have been involved.  The get rich quick scams and Ponzi schemes taking advantage of people are prolific and any reader who really thinks those scams are a  smart move should stop reading now because I do not offer the type of professional help you will require.

So what can be done? Short sales are a real and viable option for property owners who are in true financial hardship.  I am told the government is helping to put together some guidelines to help the short sale process move more smoothly like, attempting to set a maximum bank response time (10 days I heard), incentives for sellers and lenders, a stipulation that releases sellers from future debt liability  and even moving allowances for the sellers. Having a true hardship is one of the keys to a short sale, not just being upset because your home is not worth what you borrowed, but a true hardship that can be demonstrated to the lender. A short sale can help save the credit of the financially distressed homeowner by avoiding a foreclosure which will help them get back on their feet sooner and usually saves the bank time and money compared to a foreclosure. Helping the homeowner is the goal which any good agent will tell you. There are certainly easier contracts for a real estate professional  to work with for greater profits based on the time and effort spent. Short sales listings are not to be done on a whim and can involve much more work than the typical real estate agent is readily able or sometimes qualified to perform. If you need to consider a short sale, you should speak to a licensed real estate agent, but just don’t call any  agent who may or may not have experience or training in handling a short sale transaction. You most likely will be one of the 80% wasting their time with an unsaleable short sale. There are about 15,000 CDPE agents in the country right now who have advanced training in this matter. That is probably a good place to begin looking for answers. If you would like to contact me, please keep in mind that short sale listings still involve advertising and property expertise so unless you have a luxury or higher value property I will not be able to take on your business. There are agents who specialize in listing numerous inexpensive short sales and those agents are very well equipped to provide you with outstanding service for your particular needs. Don’t think I do not appreciate the needs of the low priced home seller, it is just a matter of what fits into my particular business model. I will provide you with a well-qualified referral within my office if needed.

When you pick your real estate agent, be prepared to open your financial books and hardships wide as they prepare a complete bank package. The package is a very specific proposal to the lender demonstrating why it would be in the best business interest of everyone involved for them to allow a short sale. If this cannot be properly demonstrated or if you really do not qualify for a short sale but submit your package anyway, you will be wasting everyone’s time. Your real estate agent will help you determine if you are qualified for a short sale or if foreclosure in the only option.  If you lie or your motivations are other than a hardship, you will fail and may open yourself up to legal issues and foreclosure. For your own sake, give your short sale the serious attention it requires by using a qualified real estate agent. If you have a luxury or waterfront home and are in a  real financial hardship and you would like some options other than foreclosure, call me anytime at 239-878-0637 or find additional information at www.FloridaLuxuryBroker.com.

New Specialty for the Foreclosure Market.

Time flies when you’re having fun. That is my only excuse for not posting in so long. I would like to thank the readers who continue to call me for their Fort Myers and Cape Coral real estate needs including the massive Fort Myers and Cape Coral foreclosure market. Like I have said before, my callers always get priority service because you can reach me right away and nearly all day,  excepting of course for food, sleep, family and workout times, but nearly all day.

During the past few months, I have been watching a sad but true fact in the Southwest Florida real estate market play out. While properties are selling, a vast majority are in fact the short sale and Fort Myers and Cape Coral foreclosure properties. Distressed properties are king here in the former land of speculators. Not only in the cheap, less than $100k market that I try to avoid, but also in the high-end properties. That can pose a problem to agents like myself who have always enjoyed that part of the market. Not so much for our ability to help a buyer purchase one of these great bargains, but to list a property as a short sale or even work with Bank of America or whoever requires some additional knowledge in the processes. There are forms to file, offers to submit here and there and additional wait times and general requirements. Combine that with the rightfully high expectations of the buyer and seller in a luxury home transaction and you can see how the agent had better know his business before taking on such an undertaking.

To be certain I am the broker who is at the forefront of distressed luxury home servicing, I am taking a few days out of my schedule this month to attend some rather costly course work to become a CDPE designated agent. CDPE is a national education designation agents can earn that stands for Certified Distressed Property Expert. Very few agents in the country have taken the time or paid the expense for this training. Many who are working in the short sale and foreclosure market have learned mainly through trial and error,  including myself, and most others are still struggling through their learning curve. I personally refuse to offer a service where I am not completely confident I know the entire process backward and forward and can guide my client like the professional I am in every other transaction. Now with the enormous amount of business coming my way in this specialized market of distressed luxury homes, I can’t avoid it any longer.

While few agents have become a CDPE, even fewer and devoted their work to the luxury home buyer and seller in the Ft. Myers and Cape Coral foreclosure market.  Agents think it is not a priority considering the huge number of little homes there are to sell comparatively. For me, real estate is not my first or even now the only industry I  work in. I own a national company named Propane Outfitters Inc. that is a supplier of a specific industrial materials handling product to major companies and the government from coast to coast in the USA.  I have the privilege of speaking to and conducting business with corporate executives and business owners nearly every day while providing a product that is an outstanding gauge of overall business productivity. That being the increasing or decreasing need for the storage capacity of their forklift fuel for their plants and warehouses for example. I can plainly see a decrease in productivity over the past few years and the unwillingness to spend on the higher end products we offer in favor of the least expensive. When the business owners don’t make the money, first the employees don’t keep their jobs, which has happened, then the executives start to downsize as well. That is about to hit us here now. We already see the real estate developers, construction company owners and not surprisingly many real estate agents downsizing their luxury homes. Unfortunately, it is not always a smooth transition with the property values dropping as quickly as they have here. With the continuing economic turmoil and a misled recovery that puts the boss in the dunk tank thinking that will help grow jobs, many of our luxury home owners are becoming Fort Myers and Cape Coral foreclosure victims. As everything, each property situation is just relative to another person’s perspective. One person’s distressed property at $1 mil. is a downsize bargain for someone else. If the property is not represented or sold properly, that distressed property becomes a million a dollar headache for the buyer and seller regardless of the price.

It is difficult to sell a luxury Fort Myers or Cape Coral foreclosure home where the asking price is several hundreds of thousands of dollars or more and the property is weeded over, moldy, smelly,  rotten or infested with all creation: this is South Florida after all. Banks and seller have been turning these properties over to out of town Brokers or local agents who only provide basic services and many times the properties become ruined from just sitting in Florida. Then the properties eventually get auctioned off at an even larger loss than was ever expected, worsening the situation for the sellers and further destroying local property values. While I am happy for the eventual buyer because purchase price, even they would have been happier if they did not have to now remodel or gut the once beautiful home because of simply neglect. I will be posting my new business services for this market segment in roughly a week but please contact me for additional information on these new services anytime. Find more information at www.FloridaLuxuryBroker.com.

E-Mail vs. Phone In Cape Coral and Fort Myers Real Estate

I have been increasingly busy over the past month in  my Fort Myers real estate practice as I  continue to meet buyers from around the world wisely taking advantage of our great prices in this resort area. While I can’t help the kid looking for a $50k home easily, I can find the $500k+ waterfront home for the UK buyer in my sleep. I enjoy the ability to focus my business on what I am best at, which is the Fort Myers, Sanibel Island and Cape Coral upscale property market.

I have  written briefly about this before and I have even made mention directly on my personal website www.FloridaLuxuryBroker.com about the need to pick up a phone and speak to me. I love technology. My company www.PropaneOutfitters.com  is all about the worlds newest technology in online storefronts and product ordering. Buying a property is not the same as buying an industrial steel cage on my company site.  This does not mean a client can not contact me by email which is a  typical means of first contact these days, especially with my overseas buyers. Consider this event. I recently had a  domestic client email me from my corporate web site requesting  information on a very valuable property, but  he failed to pick up the phone and ask me about the property or introduce himself even though my phone numbers are  on the web site. Meanwhile a first time buyer who wanted to spend $50k called me twice in the same time period. As the first time buyer received extensive consultation from me on financing and the search process and  a referral to an agent who specializes in first time buyers  who will give him the  expertise  he needs, the  buyer who I should  have been helping sooner was waiting  for my reply.

I know  people are jaded sometimes by the lack of competency and business aptitude that can be found in the real estate industry. I know much of that is well deserved as I  am forced  to do business  every day with some of the same people who have caused these feelings. It is maddening to pick up the phone  to conduct business and reach someone who knows less than you about their own  work. Or worse, the person you call pretends to know everything and  misleads you with the practiced lines and platitudes designed to lead you on  as they fumble through their work and hope you will  feel committed to them at some point. One of my personal pet peeves is the 24/7  agent, which means they claim they will take your call anytime no matter what. Not only does that reduce  the professional  agent to the same level as  a 7/11 store clerk, but have you ever tried to conduct serious business with someone who obviously has not had enough sleep? I keep a clock of the world time zones on my desktop so I know when not to call my clients overseas. I will take a call from some clients absolutely any time, but be assured, even if you need to leave a message you will still receive my full attention as I return you call and work for you.

Regardless of any trepidation or preconceptions you may have, when it is time to seriously conduct business in real estate, you will need to pick up the phone and speak to me at some point.  You will get specific, professional real estate consultation and up to date information on an expert  level. You can contact me by email anytime and  I will respond the same day and  usually right away. I will send you homes for review by email and extensive information about the buying process and each property  so you can practically make the decision before personally seeing the property, but I always prefer you come to  see the property. Email is especially important with my overseas clients because of the costs,  time differences and even some language accents and such are more easily understood in writing. You don’t really know a person until you speak to them and until you meet them. You should really  want to know the person who is advising you on spending hundreds of thousands of dollars or millions.  Direct communication is the most valuable and important business tool  we have in the world.

Email vs. Phone:

  • Email is perfect for data, detailed business communication and real estate research.
  • Phone calls are necessary for conducting business on a highly professional level and to ensure a  complete understanding between parties in highly complex decisions like the purchase of a property.

I have left out the  obvious importance of personal meetings just because in my area of expertise there are so many variables including attorneys, personal buyers (shoppers), spouses, outside brokers and so on who  can make decisions  besides  or  on behalf of  a client. I will probably write a complete article on that in the future.

My goal and my job is to provide you as my client with the best service possible. How well we communicate is vitally important to my ability to deliver. Both email and phone calls are very important, but  when it is time to do business do not hesitate to  pick up the phone and call me.

My Personal Real Estate Investment Picks

The press has said yesterday home prices are flattening or leveling. Sales have been picking up and inventory has been thinning, economics 101 tells us the prices will level. There is still room to move downward in some areas like north Cape Coral, Florida where the city continues with a water and sewer project that will attach an assessment of somewhere between ten and twenty thousand dollars to every property as it puts in a new water and sewer system. Considering Cape Coral is at the top of the national list for foreclosures and the well and septic systems work very well in that less populated area, that does not sound like a welcome action to the property owners. I own a property in that area and while the assessment does not affect me, especially since I already know it will mean my investment value will increase by the assessed amount or more and I will get a new road installed as well, there are those who are not so fortunate and cannot afford this assessment. While I feel bad for those people,  the best and only thing I can do is help them sell if they must, which is why I recommend that area as a great place to watch for upcoming investment deals.

My personal favorite investment now and over the next 24 months are the homes in the far southern end of Cape Coral with Gulf of Mexico access. Those homes generally peaked at over half a million dollars for basically tear downs and can now be bought for just over 100k. Not that I expect the old prices anytime soon, but consider the benefits of these investment properties: minimum 80 foot wide deep water canals with a standard lot size of 80ft water frontage and  120 to 150 foot lot depth, typical home is three bedroom two bath with a garage, usually just minutes out to the open water of the Gulf for fishing or pleasure boating, minutes away from Sanibel Island and Fort Myers Beach by water or land, direct access to the Atlantic directly across the State of Florida via the Caloosahatchee River which connects to Lake Okeechobee and exits near West Palm Beach. I hear people asking, “Where can I invest?” Buying an investment property at the bottom of the market in a location like this is hard to beat.

Here is my disclaimer, you need to do your homework before making any real estate investment. What is right for one person may not be right for another and if you buy a property without consulting a professional Realtor (see earlier article) and you pay too much or buy a lemon, don’t blame me. If you contact me and we get you a great property, then you are welcome to blame that on me to all of your friends.

New Listings In The Real Estate Industry

A large part of the real estate business for agents has always been about getting the listing. Sending the postcards, making the presentation even making cold calls if need be. As I built my real estate business that was an important part of my work as well. When  I began to specialize my real estate work into luxury homes, listings became more than just a piece of inventory to be placed in a file and on the Internet like most home listings are handled. Luxury homes need to be presented and advertised in the correct fashion to the right clientele. Advertising a million dollar home in a book that is only found in the discount store exit or a web site that no one sees is not usually going to put the information in the right hands. The right real estate marketing is a skill developed over years of practice,  media contacts and web site positioning. It is also a very large monetary investment to advertise a luxury home properly  which is another reason many agents should not attempt it for their clients sake.

As the real estate market changed over the past few years my business adapted. Why would I want to take on a listing that was dropping in value on a daily basis which drove off most all buyers. I consider every real estate listing into my business as an investment which I expect to make a return on. I only market a property the right way, so if I expect I will  spend $20k to $30k  in marketing for a luxury property, I will also expect a sale in a reasonable amount of time at or close to the price we set. For quite a while that has been a very difficult formula to justify when making this investment.

This year real estate buyers from around the world have realized the housing market in Fort Myers and Cape Coral has reached a price point that makes sense again and have slowly begun investing again in our properties. Many sellers have also realized they can sell their home at a fair market price and still be in great financial shape because their next home they buy, no matter where it is, can now also be purchased at a very good price. There are still the real estate sellers  holding out and  wishing for that extra  few hundred thousand  dollars or more that we just cannot justify with the facts.  Those people will have to wait until the next market peak to sell their property at that price. The sellers with realistic expectations and who are willing to work with facts for the purpose of actually selling a property are who I am willing to work with now.

As I mentioned in another article, I put together a business plan to sell your property. We will meet and discuss your property and your expectations. I will tell you what I will do for you and my expectations as well. We will decide on a sale price that will make you competitive in the marketplace, come to terms on a listing contract and then the fun begins. I do mean fun too; I enjoy bringing a property to the real estate market. I  use some of the most unique and high exposure real estate marketing tools on a local,  national and international level. The property will be exposed to all Realtors as there is a great possibility one of them will bring  our buyer, but our marketing is targeted to the right  clientele where ever they may be whether it is Miami, the Northeast, Lake of the Ozarks or California.  I also have contacts in Canada, Germany, the UK and other locations across the planet where our clients come from.

To find out more and  to contact me about listing your property, go to my web site www.FloridaLuxuryBroker.com or call 239-878-0637.

Approved Home Financing and Cash Home Buyers

I am a broker who is well positioned in the local marketplace. Because of that  I am usually contacted several times a day by people wanting me to make appointments to  show them properties and make  offers  before they even talk to a lender about home financing or  verify they have the cash to buy any property.  That is not the way the professional real estate business works.  You can easily find  other  agents who’s experience leads them to think real estate transactions are supposed to be a  series of  hazards,  headaches, and obstacles or you can work with me  and follow  simple steps to  create a professional transaction. Making sure you have the money in place is the first step, but one that is too often blundered.

Before we set up any showing appointments:

  1. If you do not need home financing and are paying cash, you will need your bank to prepare an evidence of funds letter to accompany our offer on the property and to show me you actually have the funds as well. Banks are happy to print those up for good customers like you. People have tried to lie to me about their finances in the past just to get the luxury home or investment tour. Some sellers will not let a buyer on the  grounds of  a luxury home without first  proof they can afford it.  Don’t be offended,  we will do the same thing when you have me sell it someday. Be sure you have the cash available to pay closing costs as well which I can  help you determine. If you are writing a check from a line of credit, fund or something similar, that is still cash and we would need a letter showing your line is open, sufficiently large  and available to you.
  2. If you are going to use home financing, you will need to talk to your lender before we schedule  on site showings  and have them approve you for the  general loan amount. That means you will need to tell them what you have in mind, show them some of the price figures and properties if needed which you and I  will discuss before  you approach them.  You must then provide them with all of the information they need to submit to underwriting so you can get the loan commitment  very soon after we have an accepted contract on a property. That means you give them your tax records, asset documents, whatever they need. You do not give that information to me, I do not want or need it. The lender will then give you a very professional letter on their letterhead which you will give to me that states you have submitted all of the information required to obtain a loan for “X” amount  and  your information  has been completely submitted to and approved by their institution with certain exceptions like the appraisal, survey, insurance,  inspection results, sales contract and such items related to the actual home and transaction that we can not provide yet. That letter will accompany the offer when I present it to the sellers. You can provide all the information and ask the lender how much you are approved to borrow and they  may give you an upper price  limit, but the more specific information you can provide the lender, the better the information you will get in return. Without working closely with your lender your answer from home financing underwriting may not qualify as an actual approval but instead just a pre-qualification which will not work for us. If there is any additional issue that comes up in underwriting your lender should be able to resolve it quickly with you if everything else has been done properly. If you are only home financing a small part of a purchase you need to show evidence of the funds to close as mentioned in the “cash” section above for the cash portion. Don’t even think about  asking to make a contract contingent upon the sale of your current home unless you have enormously overwhelming evidence that the other transaction is about to successfully close.

Why is this all so important? Because most sellers now will not look at an offer without this evidence or home financing approval from the bank. I don’t blame them considering how difficult it can be for even well qualified people to be financed. Even if it is not difficult, it can be time consuming and time is always of the essence in a real estate contract. Sellers do not want to take a property of the market unless they know the person can actually buy it. In the past, anyone could get quick, easy financing. There are still people out there who do not realize those days are gone and  go shopping for  a home when they can  not even  finance a car. This is the reason I can not physically show homes before we address home financing and one of the two above conditions are met. It is completely unfair to the sellers and my busy schedule if you are not qualified.  If you need advise on a good lender, I will recommend several excellent professionals who you can speak with and will take good care of you. I do not pretend to be a lender myself, I already have a good job. If you have the cash, you have the easy job. The bank can fax or email me what we need in minutes. Many banks are in trouble and I have had fully approved buyers have their loans denied in underwriting for no fault of their own. Chase Bank just recently did that to a very well qualified buyer of mine. We changed lenders and  closed, but the closing delay was  over a month. Just another very important reason to have the right agent like me to smooth over these types of contract difficulties.

Buying  or selling  property can be a lot of fun and a great experience, if you do it right. Otherwise it can be a very costly, hectic and even legal nightmare. These home financing requirements are important steps in handling your transaction properly. They are not the only steps, they are your first priority.

Ok, I’ll talk about the real estate market.

I was hounded to write my opinion about the real estate market. This is a new blog and I was avoiding that because everybody talks about the market. I would rather have an open exchange of relevant real estate ideas and thoughts. My take on the market in general is similar to everyone else. Low priced properties like the foreclosures and short sales are moving very well and giving the  Realtors something positive to talk about. Those properties  are not really my area of expertise, but I watch what is happening and the sales numbers are impressive. It can be difficult for the small investor to buy the best deals because we are seeing a different class of investors in the market now who are buying these homes like the pros they are. Multiple offers, multiple closings, some for rentals and some for fix and maybe flip.  I hope they keep it up because they are fixing up a lot of ugly homes and messed up neighborhoods created by the previous owners and investors owning homes they never should have been able to buy and destroying them.

Homes off water are a great buy and you can find many foreclosures and builder inventory at bargain prices. Homes on a Gulf access canal can even be an older and ugly house, but still a great investment for the future. Think long term or maybe boat house.

You can expect to get a beautiful foreclosure luxury home in the half million dollar price arena and of course up.  I found that there are many people who are still holding out for hope and change in this price range, particularly in some of the higher prices on the golf courses in south Lee County and waterfront homes in Cape Coral. I truly wish I could get you that million dollars or more the appraiser told you  it was worth  back in the real estate market of yesteryear.  I know some of you took out those equity lines and used your home like an ATM machine. You are fully entitled to your own opinion about your home value, but not to your own facts about the real estate market. Your buyers are educated  and they don’t really care why the very comparable home down the street sold for two hundred thousand less than you are asking, they just know that it did and the bank will know it as well when they get the appraisal and they will not lend money on a home that is overpriced for the market.  I would like to sell your home for the old prices, I would make more money that way as well, but that is not the way the world works.

In the true luxury home market it is more difficult to determine a real trend in the real estate market because if you want the best, it still has great value in any sales environment. The undeniable fact is that those prices are deflated across the board as well compared to the peak of the market and bargains are most certainly to be found. I have seen some multi-million dollar foreclosures that are stunning deals. Comparable sales and comparable homes in general can be hard to find when pricing or making an offer on many of these homes so be certain to call me.

If you are financing, the interest rates are still great. I think it would be foolish to think that will remain true. I am not a professional economist, but I hear many of those who are saying rates will be rising in the near future.

The lines I hate to say, but can’t avoid  are ” Now is a great time to buy!” and “You should really buy now!” It is true, especially right now as summer is here in Florida and the real estate market is slower.

Each home, neighborhood and circumstance  is different, especially in this crazy real estate market. If you want to buy or sell we will need to speak and prepare a business plan of sorts to get you to your goal successfully. That is what I do. Go to www.FloridaLuxuryBroker.com for more information.